Podcast explores bringing design for store portfolios into the 21st century
Rather than thinking only of fixture elements, retailers should mix and match what works for each store’s experiences, product mix, services, localization, and technology. PHOTO: ISTOCK.COM/GISELLEFLISSAK
By Melissa Campbell
Over the next five years, half of commercial leases will be expiring. Big-box brands will increasingly experiment with new formats. For example, Ikea recently opened its first store in Manhattan. This store showcases small living spaces to meet the needs of customers who live in the city. Brands will also increasingly consider alternative formats, including popup stores and pickup depots (like Amazon delivers on college campuses).
As retail evolves, the traditional prototype model is becoming obsolete. In the Shop! podcast “Y2K Called, It Wants Its Prototype Back: Bringing Stores Into the 21st Century,” Elaine Kleinschmidt, EVP of strategy and experience design at WD Partners, discusses a more flexible approach to prototyping based on a modular kit of parts. She also explains how stores can take steps toward an integrated, dynamic, and scalable strategy. Here are highlights.
What are the shortcomings of the traditional prototype model?
The traditional prototype model is typically a cookie-cutter mold adjusted for size: small, medium, or large. The model allows brands to control the brand expression and efficiently estimate the cost of building materials. But it doesn’t account for localization (big city vs. small town) or how generational preferences of the shoppers directly impact individual store performance. Some decisions about a particular store should be made based on its location and the customers it serves: what products and/or services will be provided? Will there be a buy-online-pickup-in-store (BOPIS) service? If so, how will that service be designed to engage the store’s customers?
What is a design kit of parts?
A design kit of parts includes five modules that can be applied to a store’s design strategy: experiences, product, services, localization, and technology. The key is to find the right combination to serve a store’s format (e.g., flagship, mall, popup) and needs. For example, for a flagship store or a popup store in a large city, the experience might comprise 50% of the design strategy. Conversely, for a mall store, the experience might comprise just 20% of the strategy, while the store’s products take 50% of the focus.
If a brand wants to modernize its approach to store design, what steps should it take?
First revisit your brand name, your value proposition, and your overall position in the post-digital world. Then understand who your customers are. Analyze the big data from a retail perspective (instead of a marketing perspective). Who actually comes into the store? How many store-only shoppers are in the database? How many shoppers are online-only? How many shoppers are multichannel? This information helps you determine strategies. For instance, multichannel shoppers are more loyal, come back more often, and buy more products.
If you have one prototype and a thousand stores, acknowledge the pain points. When you’re managing a brand at scale, ask yourself: At what point should you try to strategize the brand experience rather than treat a rollout as a tactical process?
Be proactive with store real estate. In many cases, the real estate team identifies potential store sites based on narrow and dated criteria. In selecting locations, consider the dynamic relationship between different store formats. If a region will have a flagship store, mall store, and pickup depot, how far apart should these locations be spaced? And what population density is necessary to sustain each of these formats?
Discover a new way to measure.
In true omnichannel retailing, there is no separation between a click and a brick. In a metropolitan zone, identify the nucleus of a brand and all of the brand’s other touchpoints in that area. Consider the performance of the geographical area as a whole. A store that is low-volume in purchase might be high-volume in service or BOPIS. Evaluate your social reach, brand perception, and NPS score. Tailor your financial metrics to your kit of parts; your metrics should be based on how your customer uses the brand.
Melissa Campbellis the former Shop! education manager.
Excerpted from the Shop! podcast “Y2K Called, It Wants Its Prototype Back: Bringing Stores Into the 21st Century.” For the full podcast, visit shopassociation.org/podcasts-retail-decoded. A podcast quiz is available for continuing education credit at bit.ly/ShopCE-Y2K.